Will Samsung Pay Microsoft $15 for every Android Smartphone?

J. Miller, Ph.D. on July 7, 2011 with 0 Comments

Microsoft owns a number of patents that are used in Google’s platform. This enables Microsoft to be able to receive royalties when Android smartphones are sold. HTC currently pays Microsoft $5 for each device that is sold.

Microsoft has reportedly asked Samsung to pay $15 per device. Is this a ploy to get Samsung to create more devices that run the Windows Phone OS? It could be as Reuters has reported that Samsung is expected to offer to expand its Windows Phone offerings while paying $10 per device.

Microsoft’s stake in Android market is peculiar to say the least. On one hand, Microsoft produces a product that competes in the smartphone market with Apple and Google. On the other hand, Microsoft is able to derive huge amounts of royalties from the sale of a competitor’s product. The royalties are passed on to the end consumer, so Microsoft is effectively able to raise the price of a competitor’s product while profiting at the same time.

Do you think that Samsung will be able to lower the amount that it will pay Microsoft? Leave a comment and let us know.

Source: Reuters

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